Since I’ve become interested in dividend-paying companies, I am constructing a model portfolio that I will present to the Motley Fool community, I am now planning to dig deeper into individual companies that are working their way to the top of my list. I’m planning to introduce one individual company each week until I have added ten companies to my initial portfolio. I will add from there as funds permit and as I discover new companies worth adding.
I review the company on seven different criteria: yield, number of years paying and raising dividends, 5-year Dividend Growth Rate (DGR), 5-year projected Earnings Growth Rate (EGR), total return for the past twelve months, PE and payout ratio. I constructed a rating system that awards points for each of the previous criteria. A “perfect” score would be 28 points, with 4 points awarded for all seven categories. The highest score that was realized by any company that I have examined so far is an 18, and it is awarded to Abbott Laboratories (NYSE: ABT).